ABSTRACT
In an organization’s profit and loss account, expenditure is the opposite of sales
revenue. For any given level of sales revenue, an understatement of expenditure is
translated into higher profits or lower losses. That is exactly the motive behind costing-
less accounting irregularity. Costs, expenses, expenditure and losses (but not net
losses) are similar terms and, if loosely defined, may be used interchangeably. This
area of accounting irregularity involves suppressing and/or hiding expenditure or
disguising its intent or purpose. It also covers any concealments or understatements of
an obligation to pay because, under the accrual (or matching) concept (see Chapter 2),
expenses are recorded as soon as they are incurred, regardless as to when the cash is
spent.
